Thank you, Mr. Chair, and thank you, members of the committee.
Thank you for this opportunity to be with you here today.
Enerkem is a world leader in the development and production of new generation transportation fuels.
The company manufactures, owns, and operates advanced biorefineries based on its proprietary thermochemical technology developed in-house in Quebec since 2000.
Enerkem's unique technology converts residual material, such as non-recyclable municipal solid waste, forest residues, and agricultural residues into second-generation cellulosic ethanol. It is the only Canadian company that is able to produce ethanol from municipal solid waste.
Enerkem is a growing Quebec company that now has 70 employees. It was founded in 2000 and currently operates two plants in Quebec: a pilot plant, since 2003, which is used to test technology with more than 20 types of raw materials, and a commercial plant in Westbury, near Sherbrooke, which uses telephone poles as its raw material.
Enerkem will soon start the construction of the world's first municipal waste-to-biofuel commercial plant in Edmonton, Alberta. The company has signed an agreement with the City of Edmonton for this project. The company is also developing a similar project in Mississippi, where the company has received $50 million from the U.S. Department of Energy.
In addition to meeting our renewable fuel standard and reducing greenhouse gas emissions, Enerkem contributes to reducing waste landfilling and provides a great opportunity to transform our forest industry by using forest residues to produce clean transportation fuels. By using a wide variety of feedstock, Enerkem's plants can be located in both rural and urban areas.
Building a strong domestic biofuels industry so that Canada can lead the world in the development of next-generation biofuels requires the right combination of public policy instruments. It must include:
1) A federal renewable fuels mandate to create a stable market. The government has mandated a renewable fuel content of 5% in gasoline by September 2010.
2) A capital program to help finance the construction of biofuels production facilities across the country. The government has created the NextGen fund managed by Sustainable Development Technology Canada.
3) A producer incentive to support the domestic production of renewable fuels. The government has implemented the ecoENERGY for biofuels program, which provides the 10¢ per litre. The ecoENERGY for biofuels program has largely benefited the first-generation biofuels sector and has created a solid foundation for a strong domestic biofuel industry.
The first generation of biofuels has paved the way for the next growth phase, which will involve the commercialization of next-generation technologies that are being developed here in Canada, like the one Enerkem has developed.
These technologies enable us to produce renewable fuels from a broad range of biomass, forest residues and even domestic residual materials. It also enables us to even further reduce our greenhouse gas emissions.
According to Natural Resources Canada, there is currently $473 million available within the program budget for the ecoENERGY for biofuels program. The program has received 68 new applications, representing approximately $2 billion. The government is now in the unenviable position of having to decide which programs are acceptable based on predetermined criteria. This demonstrates the success of this program but also its limitations, as the government is now faced with having to select winners.
As a producer of next-generation ethanol, we have not yet benefited from this program, as our facilities are just starting to be built and operated. We submitted our applications for two commercial plants, the one in Westbury and the new one in Hamilton.
We strongly believe that this program is essential in order to build a strong domestic biofuels industry. It is also a program that provides a certain level of parity with the United States, which also has a producer incentive for its biofuel producers. The U.S. program is more generous, as it provides cellulosic ethanol companies a total of 20¢ U.S. per litre instead of 10¢ per litre.
In conclusion,
I would like to say that, if Canada wants to take advantage of the platform it has created with first-generation biofuels and continue to promote the creation of green jobs and economic recovery with the green energy sector, this program must continue.
Specifically, this producer incentive in the ecoENERGY for biofuels program is of high importance in order to continue to build a competitive and strong domestic biofuels industry. The ecoENERGY program has built first-generation plants across the country, which is a solid foundation on which to build next-generation biofuels plants, like the Enerkem facilities. The ecoENERGY program is an important program that will ensure that future generations of clean energy technologies that we often refer to as “clean tech” are developed at home, in Canada, as opposed to abroad.
Thank you for giving us the opportunity to participate in the ecoENERGY for biofuels program hearing.
Merci.